Are Burger Franchises A Solid Investment?


Are Burger Franchises A Solid Investment?

If you are looking for a franchise niche or sector that will give you good returns on your investment, look for no other than burger franchises. These franchises are not only traditional opportunities you can sink your teeth into, but also profitable ventures whose expansion has been rapid in the past few years. A report done by the Technomic consulting firm on burger consumer trends, reveals that close to 50 percent of consumers report eating a burger once a week. This represents a 10 percent increase in consumption in just two years.

As the consumption of burgers increase, so are the franchise opportunities. Super chains such as Checkers & Rally’s continue to do well and have strong earnings growth. Below are some insider tips on why burger franchises are a substantial investment.

The Force Driving Growth

Burgers are a form of comfort food consumers resort to, especially in tough times. It is also a favorite in America when paired with French fries and are preferred due to their low cost.

Because of this, the demand for burgers is projected to rise not just in the short term, but also in the medium and long-term. Regarding sales, this is good news because the more you push in sales numbers, the higher your cumulative margin.

Enhancing Long-Term Profits

Investing in a burger franchise will not make you a tidy sum upfront, but with time, revenue will start going up and costs will remain relatively stable or will rise minimally. This will provide you with a decent return on your investment down the road with no limit to how much you can make. Once you have a grasp of the restaurant operations and management, you can invest in more restaurants to expand your influence and cash in on economies of scale.

Relatively Less Risky

Investing in a franchise has the advantage of support from a strong brand. The franchisor will back you up with training and other forms of assistance as you navigate the pitfalls inevitable in business. As long as you delegate right, your strong management team coupled with the brand influence should be able to minimize some of the risks companies of this caliber and scale encounter. Less risk means more predictability. This can ultimately give you some guarantee in the running of your business.

Established Brand

When you join a brand through a burger franchise, you become part of the family. Most of the burger brands have spent years cultivating their reputation based on high-quality ingredients, core values, sustainable business practices, and exceptional customer service. With an established name, you also have the assurance that you are starting from a higher mark in your business development.

Lastly, the money in a burger franchise speaks for itself. Assume you invest between $120,000 and $200,000. This may comprise the initial franchise fee, deposit for your lease, initial inventory, equipment, advertising, permits and licenses, and insurance. Compared to a similar investment regarding capital outlay, you make so much more from a burger franchise because the operations are not as involving, and the margin is high. You can earn a profit of about $66,000 to $82,000 annually which means a high return on your initial investment.

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